Vacancy rates continue to drop

Keefe, Bruyette & Woods recently released a report that showed commercial property managers have experienced a decline in vacancy rates, which may help increase stability.

Keefe, Bruyette & Woods recently released a report that showed commercial property managers have experienced a decline in vacancy rates, which may help increase stability.

The report, "Location, Location, Location: Commercial Real Estate MSA Tracker," showed that the best vacancy rates were in Austin, Raleigh-Durham, San Francisco and Houston, according to HousingWire. However, Detroit, Philadelphia, Los Angeles, Chicago and Cleveland were all listed at the worst markets.

"Not surprisingly, better job growth is a common theme for better-performing markets," KBW said, according to the news source. "When compared to 4Q of 2011, Baltimore and Seattle had the most overall significant improvements in rankings, while Dallas and San Bernardino/Riverside reported the most deterioration in expected future real estate fundamentals."

The report added that as the economy gets better, vacancy rates will continue to drop. However, this could actually hurt inventory levels in many places around the country. There could be some good news with this, as many areas including New York, San Francisco, Boston, Texas and North Carolina could see their local real estate investment trusts prosper in the short term due to these rapidly declining rates.

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